12/15/10: Divergent views on spending

This op-ed appeared in The Virginian-Pilot on the date shown.

LAST WEEK saw two very different approaches to governing come from two local city councils. In Virginia Beach, a local reform commission, aimed at controlling spending, was proposed. In Norfolk, a new manager was hired with an expensive compensation package.

Following in the footsteps of Gov. Bob McDonnell, Virginia Beach Councilman Bob Dyer proposed that his city appoint a similar panel to review its operations. In a letter to fellow council members, Dyer expressed concern that economic conditions will “play havoc” with the city’s budget. “The function of the Virginia Beach Commission,” Dyer wrote, “would be to take into account all the economic realities and work with the City Council, management, city employees, military, business community and the citizens to identify, study, analyze and make recommendations to the City Council as to how we can effectively and efficiently operate government during the prolonged economic slowdown.”

Norfolk’s council hired a first-time city manager and paid him top dollar to come here. The hire was made without interviewing any other candidates and, apparently, without any reference to comparable compensation. The new manager’s salary is but $3,000 less than that of the retiring city manager — and she’s been here for almost 12 years. For that matter, it is only $9,000 less than that of the Virginia Beach city manager, who has been on the job for 19 years.

Dyer is proposing a way to help the city operate in lean times while in Norfolk, happy days are here again.

The push to hire Marcus Jones, who all agree is qualified, is the direct result of the need to have someone in place to oversee the budget process. “Overall, the city’s revenues are projected to decline over the previous fiscal year’s budget due to the decline in revenue from the commonwealth, real estate taxes, and other local taxes,” from the current budget overview, will no doubt apply to the upcoming budget. Norfolk balanced its current budget with higher fees and fewer services.

Economists may claim the recession officially over, but it doesn’t feel that way: The unemployment rate remains high — both Norfolk and Virginia Beach had higher rates of unemployment in October 2010 than they did in 2009 — while property values continue to fall and consumer confidence has taken a dip. This — and more — points to a very difficult budget for the next few years.

The compensation of the city manager, in the big scheme of things — Norfolk’s budget is $1.1 billion — may not seem like a lot, but a few thousand here and a few thousand there and pretty soon you’re talking serious money. Just months ago, the outgoing city manager, Regina V.K. Williams, warned the council of the need to “downsize on a permanent basis.” Sounds like her economic view and that of Dyer are pretty similar.

And it sounds like Norfolk’s newest council members, Tommy Smigiel and Andy Protogyrou, actually get it. As reported in this paper, Smigiel raised concerns about the compensation package — and was rewarded with being called a name and being told that he didn’t “understand the way the council works.” Protogyrou objected to the severance package, saying the city isn’t IBM. “I was elected to be a good steward of our taxpayers’ dollars,” Smigiel said.

What a novel concept!

Dyer may not get his commission — Mayor Will Sessoms thinks the responsibility lies with the council — but at least he’s brought the issue to the forefront. Most of Norfolk’s council seems to have their heads in the sand about the economic realities. I’ll wager that come budget time, they will be wishing they had saved a little more money.

And so will we.